Mergers

Firms decide to merge for a wide variety of reasons, but ultimately the goal is to produce value for shareholders through improvements in efficiency. From society’s perspective, mergers also typically advance consumer welfare, either directly or indirectly.

Yet many antitrust populists decry even mergers that generate tangible efficiency improvements. And their criticisms have received attention by antitrust authorities. Their criticisms are, moreover, not just leveled at horizontal mergers — those combinations among direct competitors that have historically raised more antitrust concerns. Increasingly, concerns are being raised about vertical mergers (mergers between non-competitors that integrate different parts of a supply chain). And this is happening despite a large body of economic literature that demonstrates vertical mergers are almost always welfare-enhancing.

ICLE’s scholars consistently undertake analysis of mergers, both in academic scholarship and the popular media. The goal of this work is to provide an even-handed analysis of proposed mergers, objectively examining their likely consequences for society, with a particular focus on consumer welfare effects. As such, our scholarship offers a counterpoint to populist attacks on mergers and helps to inform a more rational analysis by antitrust authorities.

Related Resources

Will the merger between T-Mobile and Sprint make consumers better or worse off? A central question in the review of this merger—as it is in all merger reviews—is the likely effects that the transaction will have on consumers.

ICLE submitted Comments to the Federal Communications Commission in Opposition to Petitions to Deny the T-Mobile-Sprint Merger. ICLE's comments argue that the petitions to deny fail to provide any compelling reason to adopt a presumption against this merger. To the contrary, there are good reasons to think that this transaction will benefit consumers and the economy.

Geoffrey A. Manne is the President & Founder at the International Center for Law & Economics. Kristian Stout is the Associate Director of Innovation Policy at the International Center for Law & Economics.

One year ago tomorrow the Amazon/Whole Foods merger closed, following its approval by the FTC. The merger was something of a flashpoint in the growing populist antitrust movement, raising some interesting questions — and a host of objections from a number of scholars, advocates, journalists, antitrust experts, and others who voiced a range of possible problematic outcomes.

Senator Mark Warner has proposed 20 policy prescriptions for bringing “big tech” to heel. The proposals — which run the gamut from policing foreign advertising on social networks to regulating feared competitive harms — provide much interesting material for Congress to consider.

AT&T’s merger with Time Warner has lead to one of the most important, but least interesting, antitrust trials in recent history. It’s about a close to a “pure” vertical merger as we can get in today’s world and would not lead to a measurable increase in prices paid by consumers.

In brief, Delrahim spent virtually the entirety of his short remarks making and remaking the fundamental point at the center of my own assessment of the antitrust risk of a possible Comcast/Fox deal: The DOJ’s challenge of the AT&T/Time Warner merger tells you nothing about the likelihood that the agency would challenge a Comcast/Fox merger.

As has been rumored in the press for a few weeks, Comcast announced today that it is considering a renewed bid for a large chunk of Twenty-First Century Fox’s (Fox) assets. In December 2017, Fox’s board rejected a bid from Comcast that was some 16% higher than the one it ultimately accepted from Disney.

We are a group of eight scholars of antitrust law and economics affiliated with the International Center for Law & Economics, a nonprofit, nonpartisan policy research center based in Portland, OR. Without taking a position on the merits of the proposed T-Mobile/Sprint merger, this letter provides a brief explication of our views on some of the important economic issues involved in the transaction’s antitrust review.

Yesterday Learfield and IMG College inked their recently announced merger. Since the negotiations were made public several weeks ago, the deal has garnered some wild speculation and potentially negative attention. Now that the merger has been announced,…

Today the International Center for Law & Economics (ICLE) Antitrust and Consumer Protection Research Program released a new white paper by Geoffrey A. Manne and Allen Gibby entitled: A Brief Assessment of…